Constitutional Court to review dispute between Government and Senate over inheritance tax

The Plenary Session of the Constitutional Court has accepted the conflict between constitutional bodies initiated by the Government of Pedro Sánchez against the Senate. This conflict arises from an agreement made by the Senate on November 21, 2023, regarding the processing of a bill repealing the Inheritance and Donation Tax, which the Executive disagrees with. The Government argues that this agreement may violate constitutional articles and Senate regulations related to budget veto power.

Despite the Court admitting the conflict, the processing of the bill to repeal the Inheritance and Donation Tax continues. Legal sources indicate that the majority sector of the Constitutional Court, represented by Constitutional Law Professor María Luisa Balaguer, has addressed the matter. The articles cited by the Government in their argument refer to the need for government consent for proposals or amendments involving budgetary changes.

The Popular Party had proposed the elimination of the Inheritance and Donation Tax in all autonomous communities, which is currently discounted in many regions. However, some regions continue to collect the tax. The proposed law seeks total elimination, which would require the State to compensate the autonomous communities for the lost revenue. This tax currently contributes around 2.8 billion euros to the national budget, representing 1% of total tax collection, as estimated by the PP.

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